Tracy Corrigan is a columnist and assistant editor of the Daily Telegraph, who writes mainly on business and finance. She was previously with the Financial Times, most recently as head of the Lex Column.

Government ownership of General Motors isn't good for America

General Motors, the 100-year-old car manufacturer which once commanded half the US market, is about to file for government-sponsored bankruptcy. As a result, the US taxpayer will have ploughed more than $50bn into the the company, in the hope of salvaging something from the wreckage.

Is it worth it? GM's president Charlie Wilson once famously told a Senate confirmation hearing that what was good for GM was good for America and vice versa. And it is possible to argue that the latest infusion of government cash is good for GM, or at least for some of its employees, and its suppliers' employees: it will not save their jobs but it will delay the fall of the axe. This may just be stalling for time, but for the hundreds of thousands concerned, that is not nothing – and the intervention will also spread the broader economic impact of GM's pain.

However, this is not a good enough reason for intervention on this scale. As Robert Reich, the former US labour secretary, writes in today's Financial Times, "The only practical purpose I can imagine for the bail-out is to slow the decline of GM to create enough time for its workers, suppliers, dealers and communities to adjust to its eventual demise." If that is the case, he argues, the funds would be better spent helping the Midwest diversify away from cars. Quite so.

Then there is the view that government money is needed because access to private sector cash – to help a (much) leaner GM emerge from bankruptcy – is difficult to come by, given the state of the US economy and its car industry. However, this presupposes that a viable – and reasonably sizeable – business will come out at the other end. If private money isn't available to make this bet, there may be a good reason for it.

Lastly, there is the "well, we bailed out the banks" claim on the public purse. The argument goes like this: if we helped the banks, which we hate, we should jump to assist the car industry, which after all makes real things.

That isn't how it works. The government didn't bail out the banks to be nice, but because the option of not bailing them out was even less attractive. That is because there are some very big differences between the two industries. The collapse of the banking system would have disabled the entire economy (and banks should now be regulated to take account of that). Car manufacturers and their suppliers make up an important part of the global economy, but there are plenty of sectors which are entirely unaffected by their problems.

Furthermore, demand for banking services has not gone away, and banking remains a profitable business (those banks which aren't still writing off previous ill-judged loans are actually making money); global car production, on the other hand, is twice as great as demand, and US carmakers are among the least efficient – which is why GM is now following in the steps of Chrysler.

This doesn't mean that bank employees are somehow more deserving than carworkers – of course they aren't – though on average, despite popular perception, they probably earn less, I would guess. Still, it is horribly galling to see senior bankers' bonuses creep – or in some cases leap – back up this year, after they helped mess up the economy for the rest of us.

That isn't a good enough reason for the taxpayer to help out car makers, and most Americans agree. Sixty-seven per cent of Americans don't want to bail out GM. Even when presented with the stark choice between a bailout and letting GM go out of business, 56 per cent of voters prefer the second option.

In the UK, where car manufacturing has already slimmed down and is relatively efficient, there is an argument that a larger proportion of jobs should survive and that loans should be made available, in the short term, to help secure them. But the case for government ownership of the car industry – a small part of the British economy – is even weaker than in the US.